If you’re a veteran homeowner with a VA loan, pay attention to a bill moving through Congress. It’s not law yet, but it would raise VA refinance costs if it passes as written. H.R. 9237, the “Take Care of America’s Veterans Act,” would raise the VA funding fee on IRRRL refinances from 0.50% to 1.42% for most non-exempt veterans. That increase would also become permanent instead of temporary. On a fairly typical $600,000 loan, that shift does more than cost more upfront: it nearly triples how far interest rates need to fall before a refinance even qualifies under VA rules. The bill hasn’t passed the House, hasn’t reached the Senate, and hasn’t been signed into anything. Still, now’s the time to understand it, while there’s time to plan around it.

What Is H.R. 9237?

H.R. 9237 is a large veterans’ benefits package introduced in the House on June 10, 2026, with a companion bill, S. 4744, in the Senate. It bundles more than 60 separate provisions touching disability compensation, survivor benefits, VA healthcare access, and VA operations. It’s the kind of omnibus bill where a lot of unrelated policy gets stitched together and voted on as one package.

Tucked into Section 104(b) is a change to the VA home loan funding fee table. That section absorbed an earlier standalone bill, H.R. 6047, which had proposed similar fee increases but with a 10-year sunset clause. According to a letter the Mortgage Bankers Association sent to House leadership, that sunset didn’t make it into the current version. As written today, the higher fees would not expire. They’d simply become the new normal for VA refinancing.

As of this writing (late July 2026), H.R. 9237 has been pulled from House floor consideration twice. Most recently, on July 16, a motion to recommit narrowly failed by a single vote, 210-211. The sticking point that day was reportedly a different section of the bill entirely (proposed changes to how tinnitus and sleep apnea disability ratings are calculated), not the mortgage fee provision. Speaker Mike Johnson has suggested the bill may not come back up for a vote again soon, though no firm new timeline has been announced. Nothing here is settled. But the loan fee language remains in the bill exactly as described below, and it would take effect if H.R. 9237 eventually passes in its current form.

How Much Is the VA Funding Fee Going Up?

For veterans who don’t qualify for the existing service-connected disability exemption, two fees would change under Section 104(b):

• IRRRL (VA Interest Rate Reduction Refinance Loan) funding fee: 0.50% → 1.42%
• VA loan assumption fee: 0.50% → 1.00% — double today’s rate

Veterans and surviving spouses who are already exempt from the funding fee — generally those with a compensable service-connected disability rating — would remain fully exempt from both changes. This bill doesn’t touch their exemption. It’s the non-exempt majority of VA borrowers who’d feel it.

What Does This Mean for a $600,000 Refinance?

Numbers make this real in a way percentages don’t, so let’s walk through one. This is a hypothetical example built for illustration only — not an actual client’s loan file — but the math and the VA rules behind it are accurate.

Picture a Navy veteran with a $600,000 VA loan balance, a 7.125% rate on a 30-year fixed mortgage, and no service-connected disability rating, so she pays the standard funding fee. Her current principal-and-interest payment is $4,043 a month.

Today she could refinance into a 6.875% rate through a VA IRRRL, a quarter-point improvement, bringing her payment down to $3,942. That’s $101 a month in savings, or a little over $1,200 a year.

Here’s where the funding fee comes in. VA IRRRLs have to pass a “recoupment test”: the fee you pay upfront has to be recovered through monthly savings within 36 months, or the VA won’t let the refinance close.

• Under today’s 0.50% fee: $3,000 upfront, divided by $101 in monthly savings, means she recoups her cost in about 30 months. That clears the 36-month test comfortably — this refinance goes through.
• Under the proposed 1.42% fee: $8,520 upfront (that’s $5,520 more than today) divided by that same $101 in monthly savings works out to roughly 84 months, or seven years, to recoup. That fails the 36-month test outright. VA underwriting would not allow this refinance to close as an IRRRL, full stop, even though the rate improved and her payment genuinely would have gone down.

Same veteran, same loan, same improved rate — a very different outcome, purely because of where the funding fee landed.

How Much Further Would Rates Need to Drop Because of the Higher VA Funding Fee?

This is the number that matters most, and it’s the one we’d want every veteran homeowner to understand: under the proposed fee, the rate improvement needed to qualify for an IRRRL nearly triples.

Under today’s 0.50% fee, our hypothetical veteran only needs her rate to fall about two-tenths of a point — from 7.125% to roughly 6.92% — to clear the 36-month recoupment test. Under the proposed 1.42% fee, she’d need her rate to fall all the way to about 6.54%, nearly six-tenths of a point, to clear that same test.

Two-tenths of a point versus six-tenths of a point isn’t a rounding difference. It’s the difference between a refinance opportunity that shows up fairly often in a normal rate cycle and one that might not show up at all for years.

What Is the Opportunity Cost of Waiting?

While a veteran waits for rates to fall far enough to qualify, that waiting has a real price tag. It isn’t free.

Go back to our example. She could be saving $101 a month, or about $1,212 a year, starting now under today’s fee structure. If the higher fee forces her to wait two or three additional years for rates to fall that extra 0.38 points, she’s not just delaying a lower payment. She’s permanently forgoing $2,400 to $3,600 in savings she’ll never get back, plus however many years of a higher payment she has to keep making in the meantime. That money doesn’t show up anywhere on a rate sheet. It just quietly disappears.

Who Opposes the Funding Fee Increase, and Why?

The opposition to this specific provision is coming almost entirely from the mortgage industry, not from veterans’ service organizations. That distinction matters enough to spell out clearly.

The National Association of Mortgage Brokers (NAMB) has come out against the funding fee increase specifically, even while supporting the bill’s broader veteran-benefit goals. The Mortgage Bankers Association lobbied against the same provision. Brendan McKay of the Broker Action Coalition put it plainly: a refinance that “pays for itself in roughly a year and a half today would take nearly five years to recoup” under the new fee. Carlos Scarpero and Major Singleton of Edge Home Finance have raised similar warnings, noting that IRRRLs that would easily clear today’s 36-month test will fail outright once the fee jumps to 1.42%.

Rep. Pat Ryan and other congressional opponents have cited an estimate that the fee increase would raise roughly $4 billion in revenue and cost the average affected veteran borrower about $3,780. One caveat worth flagging: that $3,780 figure comes from a press release put out by an opponent of the bill, not a neutral CBO or VA cost estimate. Treat it as an advocacy number, not a settled fact.

Meanwhile, the pushback from veterans’ service organizations like the VFW, DAV, and IAVA has centered mainly on Section 108 (the proposed changes to tinnitus and sleep apnea disability rating criteria), not the mortgage fee provision. These are two separate fights within the same bill, and it’s easy to conflate them if you’re only catching headlines.

What About Combat-Injured Veterans?

We’re ending on this deliberately, because it’s the part of the bill easiest to overlook if you’re focused only on the funding fee.

Bundled into H.R. 9237 is the Major Richard Star Act, originally introduced as its own bill, H.R. 2102, and described in recent coverage as this legislation’s centerpiece. It would let an estimated 54,000 combat-injured veterans — those medically retired before reaching 20 years of service — receive both their full military retirement pay and their VA disability compensation at the same time. Under current law, many of these veterans have to forfeit a dollar of retirement pay for every dollar of VA disability compensation they receive, a longstanding policy veterans’ advocates have called the “disabled veterans tax.” The Major Richard Star Act has genuine, long-running bipartisan support and would end that offset for good.

We think it’s fair to hold both truths at once. This is a bill that would deliver real, deserved relief to tens of thousands of combat-injured veterans, and in its current form, also raise refinance costs for a much larger group of veterans who don’t have that same disability rating. That’s the actual tradeoff Congress is weighing right now, and it deserves a clear-eyed look at both sides, not just the one that affects your own loan.

Frequently Asked Questions

Has H.R. 9237 become law?

No. As of late July 2026, it has not passed the House, has not been taken up by the Senate, and has not been signed into law. It’s been pulled from House floor consideration twice, and there’s currently no confirmed date for it to come back up for a vote.

Does the funding fee increase apply to all VA borrowers?

No. Veterans and surviving spouses who already qualify for the funding fee exemption — generally those with a compensable service-connected disability rating — would remain fully exempt under this bill.

Would this fee increase eventually expire?

Not under the current bill language. An earlier version of this proposal (H.R. 6047) included a 10-year sunset provision, but that sunset was reportedly removed when the fee change was folded into H.R. 9237. As written, the increase would be permanent.

Should I refinance now, before this potentially passes?

That depends on your specific rate, balance, and how long you plan to stay in the home. There’s no universal answer. If you’ve been waiting for rates to drop before pursuing an IRRRL, now’s a good time to run your specific numbers rather than wait and see.

Does this affect VA purchase loans too, or just refinances?

The provisions detailed here specifically involve the IRRRL (streamline refinance) funding fee and the VA loan assumption fee. Other VA funding fee tiers, including those for purchase loans, are a separate part of the fee schedule and aren’t the focus of this particular provision.

Let’s Look at Your Numbers

Legislation like this moves in fits and starts, and nobody can tell you with certainty what Congress will do next. What we can do is run your actual numbers — your rate, your balance, your timeline — against both the current fee structure and what’s being proposed, so you know exactly where you stand and what, if anything, makes sense to do before anything changes. If you’re a veteran homeowner wondering whether now is the moment to look at an IRRRL, reach out. We’ll walk through the real math with you, not just the headlines.